Thursday, January 9, 2014

A major quick serve restaurant chain with over 10,000
store locations spread across more than fifty countries set itself a goal to
improve visibility across its supply chain processes so as to prevent customer
dissatisfaction and revenue loss as a result of stock-outs and missed
shipments.

The Challenge:

This organization was not able to track purchase
orders completely as they moved across an array of siloed ERP systems and other
IT applications, from suppliers to distribution centers to store locations.
When dealing with hundreds of fresh ingredients and thousands of order
variations, delayed shipments, shortages and even overages can result in
significant losses in revenue as well as unhappy customers.

The Solution:

The global restaurant chain leveraged visual process
intelligence to help them continuously monitor the progress of fresh food and
other order items through their end-to-end procurement process. The solution
gives them real-time insight into bottlenecks and delays and immediately alerts
their corporate procurement personnel to issues related to specific orders. In
addition to monitoring orders related to replenishing supplies, the restaurant
chain tracks and traces all the orders related to building out new stores –
from fresh ingredients to light fixtures! The procurement team has been able to
easily define and track service level agreements (SLAs) with each of their
suppliers and get alerted when established thresholds are met or exceeded.

By establishing a monitoring layer
that tracks the progress of every activity in the procurement process,
stakeholders are immediately made aware of delays at any particular step in the
process so that they can course correct. The new system tracks the time taken
to approve an order, communicate the details with a supplier, get an expected
receipt confirmation from a distribution center, receive a shipment
notification, confirm receipt at a distribution center, update the corporate
system, as well as close the PO.

Procurement planners can easily interact
with the system and mark specific orders as high priority – for instance, for
stock replenishment or promotional products for the holiday season and these
orders are flagged as priority within the dashboards used by the distribution
and transportation personnel as well.
Previously, shipment priorities were communicated using spreadsheets.
Process intelligence gives the restaurant chain the ability to uncover actual
supply chain patterns, analyze these processes and arrive at the optimal path.
It helps them easily define and monitor service level targets for every step in
the procurement process and immediately alert teams to delays and bottlenecks
that can result in unsatisfied customers and potential revenue loss.

The Results:

Today, their procurement personnel benefit from the
following:

·The ability to easily track purchase orders across multiple siloed ERP and
other IT systems – from suppliers to distribution centers to store locations

·They
can continuously monitor the progress of orders and reroute shipments to
prevent stock-outs

·They
can easily track shortages and overages in received quantity

·They
can get immediately alerted to delays in high priority, seasonal products

·They
can get alerted if receipt of goods are scheduled on non-work days for a
specific distribution center and immediately take action

·Decrease
costly emergency replenishment processes

Net; Net:

Catching emerging problems in a
near real time fashion can add significant monetary results in time and
customer sensitive supply chains. By
observing inflight results, immediate and significant benefits can occur,
however this approach was also used to mine and visualize the paths of many
orders for potential process improvements. The combination of real time
monitoring and process mining for process improvement discovery is powerful and
unique for supply chains.

This is
a highly summarized and anonymous case study based on Vitria’s technology